Insider Media Limited

A hot topic among many of our clients is the ASAs new powers within the digital sphere.

From 1 March, the ASA will significantly extend it's digital remit through revisions to the Non-Broadcast Advertising, Sales Promotion and Direct Marketing Code (CAP Code).

Previously the CAP Code has only applied to paid-for online marketing such as banner and pop up ads, viral ads and sponsored links. Now it will apply in full to all online marketing communications where the primary intent is to sell a product or service, or raise funds.

The change will be relevant to every company with a website, social media activity or online advertising; which in an increasingly digital age means every business. But how will it apply in practice and how do companies prepare?

Essentially, brand owners will now need to apply the same rigour and caution to ensuring that their online marketing communications comply with ASA standards as they do with their advertising campaigns. They will also need to pay particular attention to the potential minefield of social media and user generated content.

User generated content (UGC), along with editorial content, company press releases, corporate reports and investor relations materials will continue to be excluded from the ASA’s remit.

UGC includes genuine reviews, articles and comments posted by consumers. However, this content will fail to be exempt if (i) the UGC is moderated to the extent that it becomes a marketing communication by the advertiser or (ii) the advertiser's response to the UGC is regarded as a marketing communication.

This may cause significant confusion among companies. For example, many advertisers now run Facebook pages for their brands which invite UGC to be posted by consumers commenting on the products. But what if they employ people to moderate the page by removing any negative comments or posting positive responses? Or what if they "retweet" a comment made by a user on Twitter?

In such cases, the key question when deciding whether UGC has become a marketing communication will be to look at whether its primary intent is to sell a product or service. However, it is likely that it will take up to a year for a pattern of adjudications and decisions to develop in this area.

In the meantime it is essential that companies take a sensible approach, particularly as the ASA has gained new powers of sanction. These include the removal of any paid for links that lead to non-compliant advertising, along with enhanced name and shame pages.

They will also be able to purchase paid-for advertising and search engine key words to draw attention to a company's non compliance. However, the success of the new powers will depend heavily upon the cooperation of the search engine providers.

The extension to the ASA’s remit has been largely welcomed by politicians and consumer groups, as previous restrictions left vulnerable consumers without protection from fraudulent or inappropriate claims on the internet. It is also viewed as a sign that the ASA is bringing itself up to date with the latest trends and patterns in the advertising industry. However, the next 12 months are likely to bring forward some interesting test cases as the new legislation find its feet in the complex online sphere.

Marie McMorrow is a partner at Birmingham-based law firm DLA Piper